The Jackson County Board of Commissioners took action Monday night to help the BJC Medical Center Authority resolve cash flow problems and pay short-term debts.

The commissioners agreed to send a letter of guarantee and line of credit to Bank of America on hospital bonds Jackson and Banks counties are already paying. When the bonds were sold, they were structured so that the assets of the hospital were pledged as collateral.

The medical center authority needs these assets freed up to be used in its effort to refinance other loans to cover short-term debt. The authority originally asked the commissioners for $3.2 million to pay off accounts receivables and other short-term debt.

“The county hasn’t defaulted on payments but since the hospital has other debts and has short-term payments, they want to restructure some of their debts,” finance director John Hulsey said. “This guarantee and letter of credit will allow Bank of America to release the hospital’s assets that were placed as collateral.”

The authority and a Tennessee company, Restoration Healthcare, have signed a nonbinding letter of intent for Restoration Healthcare to purchase the medical center, but negotiations are still under way. Last week, BJC Authority chairman Charles Blair said the two parties expect to have a final draft of the agreement soon. Any sale of the medical center must be approved by the attorney general’s office. Blair said last week that the target date for meeting with the attorney general is next week.

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